UPDATE 4-Garmin 2nd-qtr profit beats expectations, shares rise

miércoles 5 de agosto de 2009 21:22 CEST

* Q2 adj EPS $0.83 vs est. $0.51

* Q2 sales $669.1 mln vs est $670.5 mln

* Q2 margins of 53 pct not sustainable

* Cuts Q2 operating costs 15 pct

* Shares rise 24 percent (Adds details, analyst comment, updates share movement)

By Savio D'Souza

BANGALORE, Aug 5 (Reuters) - No. 1 U.S. navigation device maker Garmin Ltd's (GRMN.O: Cotización) quarterly profit blew past market expectations as PND sales picked up and expenses fell, but said the margins in the quarter were not sustainable.

"We expect cost increases to hit us unfavorably during the third quarter, so in terms of sustainability, we couldn't continue to see 52.6 percent numbers (in gross margins) in the third quarter or beyond," Chief Financial Officer Kevin Rauckman said on a conference call.

The company's stronger gross margins in the second quarter were helped by currency fluctuations, product mix, stable prices and raw material cost reductions.   Continuación...